E-commerce Overview Series: Printing Industry in Canada

Publication Date: February 2004

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Description of the Sector

The printing sector in Canada is labour-intensive, employing more than 84,000 people across 5,834 firms (Strategis.ic.gc.ca). Over 99% of these firms are small- to medium-sized enterprises (SMEs) with fewer than 250 employees. The majority of them are located in Ontario (43%) and Quebec (26%).

Activity in this sector can be subdivided into six sub-sectors: commercial silk screening, instant printing, digital printing, commercial forms printing, other printing operations and printing support operations (refer to Diagram 1).

Diagram 1
Breakdown of the Printing Industry in Canada

The printing industry is geographically segmented (Statistics Canada, 2000), with 69% of firms based in Ontario and Quebec.

Role of Information and Communications Technologies (ICT) in the Sector

Far from signalling an end to paper, ICT spurred on by the Internet are having a profound impact on business practices in the printing sector. For all sectors of the printing industry combined, the number of firms in Canada having a Web site increased by 6% between 2002 and 2003 to reach 33% (see Table 1).

Table 1 - Percentage of Firms Having a Web Site in the Printing Industry in Canada

NAICS Designation (1)	Percent of Web Sites (2003)
	CAN	ON	QC
Commercial Silk Screening	35%	41%	33%
Instant Printing	29%	33%	19%
Digital Printing	32%	37%	23%
Commercial Forms Printing	42%	43%	40%
Other Printing Operations	33%	38%	27%
Printing Support Operations	38%	43%	30%
Total - Printing Sectors	33 %	38 %	26 %

(1) NAICS - North American Industry Classification System
Source: Scott's Business Directories, 2003.

The lowest proportion of firms having a Web site is found in the instant printing sub-sector.

Printers exhibit a growing interest in Internet services through their presence on the Web, and their use of the Internet in managing their business relations.

Certain Web sites seek to establish a personal interface with customers by offering them a variety of services and a great deal of flexibility. For example, clients are able to view their print job remotely and to make changes to it right up until press time.

Electronic business (e-business) tools favour the creation of networks of SMEs that bring together new business partners and open the door to contracting out and to the sub-contracting of surplus capacity. Consequently, ICT may present firms with worthwhile opportunities to improve various business processes.

New Electronic Business Models

ICT provide printers with a toolbox of technological solutions resulting from new e-business models such as e-shops or virtual stores, electronic procurement, print-on-demand, virtual service providers, electronic marketplaces and e-malls. The structure of the industry is in transition. Diagram 2 sets out a few examples of firms or Web sites that are leading the field in the printing industry. Canadian SMEs in the printing industry are found, for the most part, in quadrant one.

Diagram 2
Technology Solutions Arising From Business Models

To fully understand diagram 2, the reader should consult the document entitled "Electronic Business Models: A Conceptual Framework for Small- and Medium-sized Canadian Enterprises" at the following address: www.cefrio.qc.ca/english/pdf/Strategis%20_Eng.pdf . This document describes in detail the four main models illustrated in the above diagram.

Issues for Canadian Firms

Integrating ICT into the business processes of printing firms poses many challenges. These include creating transactional and interactive Web sites for customers, purchasing digital presses, establishing a networking infrastructure and reducing procurement expenses through the adoption of new purchasing practices (electronic marketplaces, aggregated purchases).

Barriers

A large number of SMEs in the printing sector appear reluctant to adopt e-business models. A European Commission study outlined barriers to selling online in the media and printing industries. The top three identified were: 1) lack of adaptability of printing products to online selling; 2) lower revenues from online sales; and 3) difficulties linked to the culture of the firm.

Opportunities Open to Firms in the Sector

ICT will make the printing sector more competitive by presenting firms with opportunities to improve productivity by reducing costs and fostering the development of new types of customer relationships. Firms may benefit in four ways: 1) diversifying traditional activities; 2) automating customer support activities to create value added; 3) reducing costs and turnaround times of management processes and; 4) moving to digital printing for growth.

The firm needs to identify electronic solutions that are a good fit with its business model if it is to successfully manage its strategy, and the kinds of change that it faces.

References

Scott's Business Directories – Quebec Manufacturers, 2002
Scott's Business Directories – Quebec Industrial, 2003
Statistics Canada, 2000, Canadian Business Patterns (Beyond 20/20)
http://strategis.gc.ca

To learn more, you can visit these Web sites: 

www.cefrio.qc.ca/english/indexAccueil.cfm
http://strategis.gc.ca/bis
http://strategis.gc.ca/ebizenable
http://sourcecan.com

Published in Partnership

This document has been prepared by CEFRIO, as part of the project "New E-business Models and SME Development", a project undertaken in cooperation with Industry Canada, the National Bank of Canada, TELUS, CANARIE and Canadian Heritage.

The research team included Mrs. Louise Côté and Mr. Michel Vézina from HEC Montréal, and Mr. Vincent Sabourin from the Université du Québec à Montréal.

For more information, please go to the CEFRIO Web site – the authority on information technology appropriation – at: www.cefrio.qc.ca/english/indexAccueil.cfm .